Navigating the Affordable Care Act

The federal health law known as the Patient Protection and Affordable Care Act aims to increase the nation’s access to medical care while ensuring quality and improving patient outcomes.

That’s a tall order, and no one knows for certain whether Obamacare will achieve all those goals.

The result will be critical for Florida, where an estimated 3.8 million people lived without health insurance in 2011, representing about a quarter of the state’s population, according to the U.S. Census Bureau. In the entire United States, only Texas has a higher rate of uninsured residents. Within Florida, Miami-Dade County is home to the largest number of uninsured — an estimated 744,000 people in 2011, or more than one in three residents. Broward’s uninsured rate is 26 percent, or about 392,000 people.

Many of these individuals stand to benefit from the centerpiece of the healthcare reform law: the online health insurance exchanges unveiled Oct. 1 — at healthcare.gov — where Americans can shop for health insurance plans. A marketplace for small business owners with fewer than 50 employees has been delayed until Nov. 1, and enrollment through a Spanish-language website, cuidadodesalud.gov, also has been delayed until about Oct. 21.

On the exchanges, people will find out if they are eligible for federal subsidies to help pay for insurance premiums and out-of-pocket costs, or if they are eligible for Medicaid, the federal-state health insurance program for the poor.

Enacted in March 2010, the health law will roll out in phases through 2018, and it already has triggered significant reforms, including new regulations for insurance companies, hospitals and other healthcare providers, and new protections and requirements for consumers.

The consumer reforms include:

• Dependent coverage for adult children has been extended to age 26 for all individual and group policies.

• Insurance companies must publicly justify rate increases of 10 percent or more before raising premiums.

• The adoption of a “medical loss ratio,” which requires that insurance companies spend at least 80 percent of customer premiums on healthcare and quality improvement — or issue a rebate to policyholders.

• Insurance companies also are prohibited from placing lifetime limits on the dollar value of coverage for individual and group health plans, and they’re not allowed to rescind coverage except in cases of fraud.

• Beginning in 2014, insurance companies can no longer deny coverage to individuals based on preexisting medical conditions.

The law also affects providers. Healthcare reform is encouraging doctors, hospitals and other healthcare providers to reduce hospital readmissions, manage chronic conditions more effectively and improve outcomes of patients by changing the way doctors are paid by Medicare, the government healthcare program for the elderly that sets the pace for all other health insurers.

Payments will be based on patient outcomes that can be measured and not on a fee-for-service model that rewards providers for every service they provide without considering whether those services were necessary or even beneficial.

For all its ambitious goals, however, the health law is also an experiment on a scale not seen since the Medicare and Medicaid programs were signed into law in 1965. No one knows how many of the estimated 48 million uninsured Americans the law is intended to help will buy health insurance or pay a penalty.The Congressional Budget Office projects that seven million eligible Americans who previously had no health insurance will sign up for a plan during the open enrollment period, which began Oct. 1 and runs through March 31.

Eligible Americans and legal immigrants can sign up at any time during those dates. For coverage to begin on Jan. 1, they must enroll by Dec. 15.

Health and Human Services Secretary Kathleen Sebelius said during a visit to Miami in September that the White House considers it an important measure of success to meet the CBO’s enrollment projection.

Perhaps the most significant measure of success will be how many people who couldn’t afford insurance or find an insurer will now have a choice.

“Some of it is about changing the way people get care,” Sebelius said, “but also putting some incentives for people to get preventive services, get checkups, find things early, get it taken care of, fill your prescription drugs and follow the doctor’s orders so that you don’t end up back in the hospital. That’s all going to be much more possible with insurance more affordable and available for lots of folks.”

With so much to keep track of, here are some points to consider while you navigate the changing landscape of healthcare.

The health law’s individual mandate is a cornerstone of reform that will affect a large number of the estimated 48 million people under 65 who now do not have insurance.

Those who fall into that category, their children and anyone claimed as a dependent on their income taxes must have health insurance beginning in 2014.

More than half of Americans, about 55 percent of the population, had employment-based insurance in 2011, according to the Census. Most of them will not need to buy policies on the exchanges, which are primarily for uninsured people or those whose employer-based coverage is too expensive or lacking in benefits. Another 12 percent of Americans are insured through Medicaid or the Children’s Health Insurance Program, both of which are federal-state partnerships for the poor and disabled.

Some people are exempt or don’t qualify for coverage:

• People 65 or older on Medicare do not have to sign up.

• Undocumented immigrants are not eligible for coverage.

• Also exempt: members of Native American tribes and individuals who cannot afford coverage because the cost of premiums exceeds 9.5 percent of household income.

• Anyone whose income is below the threshold for filing a tax return also is exempt, as are people who would have been eligible for Medicaid through the health law’s expansion.

Florida is one of more than 20 states that did not expand Medicaid, which according to the Urban Institute would have provided coverage to more than one million state residents. The Florida Legislature chose not to accept more than $50 billion in federal funds over 10 years to expand Medicaid. That left an estimated 995,000 people — mostly the poorest Floridians and minorities — without any financial assistance for coverage.

Those in the “coverage gap” are people with poverty-level incomes who earn too much to qualify for Medicaid but not enough for subsidies to buy health insurance through the new online exchange.

“They really will be without affordable options,” Sebelius said during her September visit to Miami.

The coverage gap was an unintended consequence of the 2012 Supreme Court decision that upheld the Affordable Care Act.

The law was supposed to provide health insurance for most Americans next year by expanding Medicaid in every state to include people earning up to 138 percent of the federal poverty level — which is about $15,900 for an individual in 2013, or nearly $32,500 for a family of four.

Tax credits would then go to other low- and middle-income people to help them buy coverage on the insurance marketplaces. But the Supreme Court ruled in summer 2012 that states could opt out of the expansion. Florida was among the states that took the option.

In Florida, Medicaid does not cover single, childless, working-age adults, a restriction that affects mostly men.

Also in Florida, a family of four with an annual household income between $4,721 and $23,300 — or 20 to 90 percent of the Federal Poverty Level for 2013 — would be on their own to find health coverage, according to HHS officials, with no option for Medicaid or a premium subsidy on the insurance exchange.

There are a variety of ways for consumers to learn more about the law’s requirements, the health plans advertised on the exchanges — also called marketplaces — and eligibility requirements for tax subsidies.

The Healthcare.gov website created by the federal government for enrollment is where you go to create an account to shop for an insurance plan. You’ll be asked to provide information such as household size, location and citizenship status.

The exchange will refer you to Medicaid if you’re eligible. If not, you may be eligible for a subsidy to defray the cost of buying a health plan on the exchange. Subsidies will be paid directly by the government to the insurer.

Once the question of subsidy has been answered, the exchange will show you a list of health plans offered in your area, with premiums and out-of-pocket costs including deductibles and co-payments.

If you decide to buy one of the plans offered on the exchange in your county, you’ll be directed to the insurer’s website to pay for the plan. You can also complete a paper application or get help over the phone by dialing 800-318-2596, the consumer help line for the insurance exchange.

Among the resources available to help consumers:

In August, HHS awarded $67 million in grants to more than 100 organizations nationwide to act as “navigators” who help the uninsured understand the new health law and enroll in coverage through the online exchanges.

In Florida, eight groups were awarded $7.8 million in navigator grants. The groups will not canvas neighborhoods knocking on doors. They’re also prohibited from selling plans or steering consumers to particular insurers. Instead, they will be based in offices or temporary quarters where consumers can meet with them for in-person guidance only.

Navigators in South Florida include the Epilepsy Foundation of Florida and the National Hispanic Council on Aging.

The Epilepsy Foundation’s staff is partnering with organizations like Catalyst Miami and Sant La in Little Haiti that will help with education and enrollment efforts in Miami-Dade.

The foundation’s toll-free number is 877-553-7453.

The National Hispanic Council on Aging has not yet announced its partners but advises consumers to call 866-488-7379 or send an email to nhcoa@nhcoa.org for assistance.

In July, HHS awarded $8 million to 46 Florida health clinics so they can help consumers learn about the new exchange. The clinics, which serve more than 1.1 million patients a year — half of whom are uninsured — will hire about 100 additional employees with the grant money.

Among the South Florida health centers that received the grants: Banyan Community Health Center in Miami; Broward Community and Family Health Centers in Hollywood; Camillus Health Concern in Miami; Citrus Health Network in Hialeah; Community AIDS Resource in Miami; Jessie Trice Community Health Center in Miami; North Broward Hospital District in Fort Lauderdale; and the Rural Health Network of Monroe County in Key West.

A full list of community health centers where consumers can meet with outreach and enrollment workers is online at:

Certified application counselor groups help people understand, apply and enroll for health coverage through the exchange. Counselors are trained and must comply with privacy and security laws. A list of counselors can be found online at https://localhelp.healthcare.gov.

The government expects agents and brokers to play a key role in the new exchanges. In Florida, many insurance agents and brokers have taken the required certification training so they can educate consumers about the exchange. They also will help consumers determine eligibility and subsidies, compare plans and enroll in coverage.

Call 800-318-2596 for help 24 hours a day, seven days a week in 150 different languages.

Dozens of Florida organizations and businesses have formed a volunteer network to help uninsured residents learn more. The network includes Community Service Center of Perrine; Community Service Center of Westchester; the Episcopal Diocese of Southeast Florida; Health Council of South Florida; Jackson Health System; Jessie Trice Community Health Center; and the League of Women Voters.

Consumers can compare policies, including premiums, deductibles and other out-of-pocket expenses, sold by different companies on the exchange.

Benefit information is standardized to make it easier to compare cost and quality.

Plans are divided into four different “metal” levels — bronze, silver, gold and platinum — based on the deductible size, copayments, provider networks and cost-sharing. A low-cost, high-deductible catastrophic plan will also be available for those 30 and younger. The plans are divided into the “metal” tiers based on cost-sharing. In a bronze plan, there’s a 60/40 split, with the insurance company paying 60 percent and the insured paying 40 percent of covered costs after the deductible is met. For silver, the split is 70/30, and for gold, it’s 80/20. A limited number of platinum plans with higher premiums will also be available.

To determine eligibility for government subsidies, the exchange will be linked to tax information as well as state wage databases to which employers report every quarter. The application also asks consumers to project their income for 2014.

A worker who gets job-based insurance is eligible for a subsidy only if the employer’s coverage is either not affordable or doesn’t provide “minimum value” — which means that the employee’s share of the premium for self-only coverage (not a family policy) cannot exceed 9.5 percent of household income, and the plan covers at least 60 percent of expected medical costs.

Any individual and family members eligible for an affordable, minimum-value, employer-sponsored health plan cannot get federal subsidies.The health law provides subsidies to help only people earning between 100 and 400 percent of the federal poverty level, a range that translates into $11,500 to $46,000 for an individual and between $23,550 and $94,000 for a family of four.

The subsidy is calculated using household income and the cost of a benchmark plan — the second-lowest priced silver plan on the exchange.

If you qualify for a subsidy, you can use it to buy any of the plans you like. Healthcare.gov, the marketplace website, has a subsidy calculator.

The exchange will tell applicants the maximum credit they are eligible for, and consumers can decide whether they want to take the maximum or some lesser amount. Those who think their income might increase beyond what they projected might consider taking less so they won’t have to repay the government at year’s end The subsidy is paid directly to the insurance company.

There’s one other type of financial help: a cost-sharing reduction for individuals and families with incomes of up to 250 percent of the poverty level ($28,725 for an individual or $58,875 for a family of four).

Under the health law, health insurance companies offering coverage through the exchange must lower the amount these consumers pay out of pocket for deductibles, coinsurance and copayments.

The out-of-pocket savings apply only to silver-level plans, and consumers will find out if they’re eligible for these cost sharing reductions when they apply through the exchange.

The law does require consumers to contribute a specific percentage of income to the premium, based on a sliding scale.

For example, if your household income is 100 to 133 percent of the poverty level, your subsidy will ensure you never pay more than 2 percent of your income for silver-level coverage, no matter how much it costs.

If your income is at 300 percent of poverty, then you’re required to contribute 9.5 percent. The subsidy then makes up the difference between that amount and the cost of the benchmark plan.

For everyone, regardless of income, annual cost-sharing — what consumers pay out-of-pocket for medical services and deductibles but not premiums — will be capped at $6,350 for individual policies and $12,700 for family plans in 2014.

You can choose not to buy health insurance, but you’ll pay a penalty unless you fall under a narrow list of exemptions. The penalty for all others in 2014 is 1 percent of annual income or $95 per person a year, whichever is higher. The penalty increases every year. In 2016, it is 2.5 percent of income or $695 per person. For uninsured children in 2014, the fee is $47.50 per child, with a family maximum of $285.

After open enrollment ends on March 31, those who have chosen not to enroll won’t be able to get health coverage through the exchange until the next annual enrollment period, unless they have a qualifying life event, such as moving to a new state, certain changes in income and changes in family size.

Information from Kaiser Health News, Healthcare.gov, the U.S. Department of Health and Human Services, and the Center for Medicare and Medicaid Services was used for this report.

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